Saber Rattling at United Airlines

Derg

New Arizona, Il Duce/Warlord
Staff member
July 15, 2008

Dear fellow pilot,

Recently, this Corporation compared our current environment to the crisis of September 11 which led to the bankruptcy we entered nearly six years ago. My observation is that the bankruptcy storm was weathered on the backs of the pilots and other employees through our sacrifices. The company will not enjoy that same luxury to get through this latest crisis. The pilots and other employees simply have no more to give. Were tapped out. It is my belief that if the company expects to weather this storm, it must find a way to appeal to the employees goodwill, and it is my opinion that this employee group is not inclined to follow this management group anywhere.

No one disagrees that the environment today is different from that of last year, last month or even last week. The price of jet fuel sets record highs day after day. The price of an airline ticket is modestly increased, fuel surcharges are added, baggage fees are imposed and soda charges are collected. At home, the cost of gasoline to fuel the cars we drive to work moves upward; the loaf of bread, gallon of milk, and dozen eggs that we buy to feed our families cost more. In the workplace, our hours are longer and our pay remains stagnant while the cost of living skyrockets. We are confronted with maintenance challenges, we are confronted with scheduling challenges, and we are confronted with weather challenges. Yet, we continue to exhibit the highest degree of professionalism in providing our customers with safe, reliable transportation. For all our efforts, this company continues to display its total lack of respect of the front line employees who make this airline fly everyday.

For more than seven months your union has confronted this management with the undeniable fact that the contract you and I are currently burdened with is no longer acceptable, viable or sustainable. Despite being in the same environment, I dont have an answer when you ask, “Why do Americans pilots make more than I do and still have their pension?� “Why are Southwests pilots treated better by their management?� “What is it about Continentals management that they announce layoffs and in the same breath said they would forgo their salaries for the remainder of the year?� “Why are we so different?�

We face a focused, hostile and arrogant management group: a management group that gives not a damn about you, your well-being, or the well-being of your family. A management group that has rewarded everyone but the frontline employees who make this airline fly everyday. They have rewarded themselves with exorbitant bonuses, they have rewarded the shareholders with untimely dividends and they have rewarded the banks with premium fees for the pre-payment of debt and covenant relief.

Since my election last October, your MEC leadership and I have been busy with many moving targets. Immediately after our election we learned that United was in serious talks with other airlines about possible mergers. In the event of any such merger, we took every necessary step to ensure that the United pilots would be included at the table of any merger talks. Had a palatable merger gone forward, we would have been successful in our goals of collective gains for our pilots. Subsequently, US Airways was, for us, a “no deal� and we worked hard both in the public eye and behind the scenes to stop that merger. We no longer find ourselves in the merger arena.

Just more than seven months ago, in an effort to restore dignity, respect and financial sanity to our careers, your union took a new tack with this management team. We made it clear that there would be no more concessions from this pilot group, and we repeatedly pointed out to our executives that contented, motivated employees directly affect the bottom line. As recently as last week, I repeated once again that there would be no more concessions.

We have been asking the company to begin negotiations and open our contract earlier than traditionally required. The purpose for this repeated request should be obvious: we continue to live our lives and work our jobs under the onerous contract imposed upon us during bankruptcy. We did not willingly negotiate our present contract. We reluctantly agreed to it only under the duress of bankruptcy. This senior management group does not live under the same contract or even the same environment that we continue to live under. Managements bankruptcy ended in February 2006. Ours goes on and on with no end in sight. They give not a damn.

We have been attempting to negotiate quality-of-life and fatigue mitigation improvements to our contract since January 1st. As recently as May 22nd we exchanged a proposal that would significantly improve your working life in hopes that the company would recognize the value of your goodwill. These negotiations have been slow and unproductive. Most of the focus over the past few weeks has been on the furlough mitigation agreement in which we reached closure on July 10th. While these negotiations led to the recently ratified agreement, what was contained in that agreement was meager at best. As I said in my recent video message of June 25th, many of the items contained are offered out of hand by most companys that find themselves in a similar situation without any negotiation. This management feels, and continues to feel that any “gain� no matter how large or small, must be “offset,� management-speak for concession.

I hold out little hope for improvements on the remaining issues. On a pilot early retirement plan (PERP), the company is so far away from a realistic proposal I have instructed the Negotiating Committee to cease discussions on the subject. On the quality-of-life and fatigue mitigation items, items which are of no cost to the company, I have also instructed the Negotiating Committee to cease discussions as each and every counter proposal by the company has contained “offsets.� There will be no offsets. When the company realizes that happy, motivated pilots “offset� the costs associated, if any, with quality-of-life improvements and fatigue mitigation, then and only then will you see improvements in your daily work lives.

We all have known that this management group is inept when it comes to the operational side of the airline. Uniteds environment is exasperated by this managements failure to adequately plan and prepare for the future. While other airlines have hunkered down and saved cash to weather the economic storm, Uniteds senior managers squander money on themselves and unwarranted dividends. While other airline executives have foregone salaries during these times, Uniteds executives continue to reward their poor business decisions with millions of dollars. While other airlines are grounding fuel-inefficient airplanes and replacing them with newer more fuel efficient aircraft, United announces a plan to ground up to 100 aircraft, increase its express flying and lay off thousands of employees. While other airlines acknowledge the sacrifices its employees have made in the past, United dismisses the sacrifices of its employees and instead demands more. While other airlines concentrate on reducing costs in todays price-sensitive environment, United continues year after year with the highest costs in the industry. While other airlines concentrate on customer satisfaction, United lags the industry in nearly all consumer ratings.

At the Merrill-Lynch Transportation Conference held June 18 in New York, United unveiled their latest plan. Entitled Back To Basics, here are the goals management sees to getting United back on track: “Industry-leading margin and cash flow, unrivaled customer satisfaction and experience, aligned employees, and world class safety performance.� Take another look at those goals, and decide for yourself how pilots contribute to them. Uniteds pilots contribute significantly to the “margin and cash flow,� “unrivaled customer satisfaction and experience� and to the “world class safety performance.� But those contributions go unrecognized and disrespected, except for the occasional hotdog in the domicile. Glenn Tilton justifies his high salary because of all the “hard work� he claims to perform on behalf of this airline. His “hard work� has resulted in our stock price down 91%, customer and service ratings in the toilet, and icy employee climate survey results.

There are many low-cost and no-cost items that would go a long ways towards improving pilots quality of life, creating goodwill and increasing the bottom line. Examples are opening the contract early to ensure its completion by the amendable date; an effective trip trading system with realistic flexibility; a realistic cap and minimum guarantee; downtown layovers that only cost just slightly more than 10% of management's recent stock take away; and offers to fly 90 seat United aircraft to offset the express RJ-50s that are financially draining - even more important now with the impending 737 groundings. But then this management gives not a damn.

United must learn that goodwill and respect for employees go a long way in a service industry. This company publicly desires the admiration equaling those of Fortune 500 companies but it is not willing to earn it. Respect cultivates respect; and contempt breeds contempt. Engaged employees make aligned employees. We are looking for a new beginning and believe this management group is missing a valuable opportunity by refusing to engage with its pilots and employees.

You will see renewed and focused efforts on the part of your union that will highlight the importance of United pilots contributions to this airline. Do not discount the efforts all of us make each and every day that enable this company to operate. We cannot get out from under the present contract on time if we do not begin our work now. Stay connected, get on board and be unified.

Fraternally,

Captain Steve Wallach
Chairman, United MEC
 

surreal1221

Well-Known Member
Best of luck to those guys.

A joke this industry has become.

Saw on another board reports that they plan even more job cuts.

"Ah yes Jim. . .time to reduce our work force so we can reduce ourselves to profitability. . .it'll work this time - I swear."
 

stuckingfk

Well-Known Member
This post isn't directed at any single person, but do pilots understand business.

I've always said to people that ask me about United, "They need to cut jobs. They have too many support workers and it's dragging the company down."

About 5 minutes of research confirmed my opinions.

United
  • 55,000+ employees
  • 3200 daily flights (which includes its UAL express partnerts
  • 460 mainline aircraft
  • 40% of mainline aircraft do international

Southwest
  • 34,278 employees
  • 3400 daily flights (NO express partners)
  • 527 aircraft, which as many know are all 737s
  • No overseas flying

Just a quick look at this, how come Southwest can fly more daily flights wtih 20,000 less employees? Now some will say the international flying adds a lot, so I'll spot you 10,000 employees which still leaves an extra 10,000. United needs to trim down. This should have been done years ago. I feel bad for the employees but if this company wants to survive, there needs to be cuts.
 

WacoFan

Bigly
This post isn't directed at any single person, but do pilots understand business.

I've always said to people that ask me about United, "They need to cut jobs. They have too many support workers and it's dragging the company down."

About 5 minutes of research confirmed my opinions.


United
  • 55,000+ employees
  • 3200 daily flights (which includes its UAL express partnerts
  • 460 mainline aircraft
  • 40% of mainline aircraft do international

Southwest
  • 34,278 employees
  • 3400 daily flights (NO express partners)
  • 527 aircraft, which as many know are all 737s
  • No overseas flying
Just a quick look at this, how come Southwest can fly more daily flights wtih 20,000 less employees? Now some will say the international flying adds a lot, so I'll spot you 10,000 employees which still leaves an extra 10,000. United needs to trim down. This should have been done years ago. I feel bad for the employees but if this company wants to survive, there needs to be cuts.
I would be very interested to know the employee counts at both for management and administrative positions. I believe this is wher the fat would be most apparent.

I can see that UAL would need more FA's - bigger airplanes require more. I can accept that UAL would need more maintenance people even though they have less airplanes because of the mixed fleet. I would imagine the layers upon layers of beauracracy would be the difference maker between the two, and also a more financially significant portion of the payroll (middle managers do ok money-wise and it is difficult to tie some of their work-product to direct revenue).

Just a hunch, but I would guess that UAL's management and administrative functions are what is bloated and overpaid - not the pilots, mechanics or FA's.
 

surreal1221

Well-Known Member
I love it.

Once again. . blame the blue collar labor for a company's issues.

Have we not learned a thing?

Waco, you're on to something. . .good man.
 

Derg

New Arizona, Il Duce/Warlord
Staff member
It's like animal farm. Some animals are more equal than others.

Fuel costs are up. WE need to cut YOUR pay. But I need a bonus because without my talent, you will sink.

Eeeeeeeven though that talent's lack of foresight and business savvy helped steer the boat right into the rocks.
 

SteveC

Really?
Staff member
I love it.

Once again. . blame the blue collar labor for a company's issues.

Have we not learned a thing?
Sometimes a company's issue is that they have too much blue collar labor.

[general comment, not purposefully specific to UA]
 

surreal1221

Well-Known Member
But blaming that same blue collar labor that they hire month after month, at least twice a decade?

I would have just figured all these whiz-kid MBA's would have figured this out by now.
 

stuckingfk

Well-Known Member
I love it.

Once again. . blame the blue collar labor for a company's issues.

Have we not learned a thing?

Waco, you're on to something. . .good man.
Kind of funny how you're thinking I'm blaming the blue collar workers. I am not. Waco is on to something, that I already explained a post before his. I just didn't put a name on the workers that need to be cut. Obviously you need pilots, mechanics, FAs to run an airline. Where they need to cut is the workers that don't see the likes of an airport. Lots of fat around the middle that needs burning.

I could go more and more into crap you wouldn't understand or would refuse to accept, but it would seem to be a waste with your all mighty union is the end all attitude.
 

Derg

New Arizona, Il Duce/Warlord
Staff member
I think SweetTea Innanashnul dropped a few thousand employees earlier this year and I can't say I've seen much of a difference at all. Probably axed the art director for napkin logos or something.
 

EDUC8-or

Well-Known Member
I'm sure another factor in the lopsided employee numbers is the amount of destinations. SWA has 70ish destinations, where UAL has 210 or so. No matter how small the airport, that's quite a few employees, I'd guess over 1000.
 

surreal1221

Well-Known Member
I'm sure another factor in the lopsided employee numbers is the amount of destinations. SWA has 70ish destinations, where UAL has 210 or so. No matter how small the airport, that's quite a few employees, I'd guess over 1000.
Yup.

Great observation.

But who put those people there? And why so many destinations? Are all of the destinations profitable? Or are they there simply to try to increase their market share?

Nevertheless, it's not the station personnel's fault that their management has failed them. The station personnel didn't tell management "You will put flights to this city." Nope, they were hired by a management team that either expect profitability - and failed, or were willfully ignorant to the inability to have a profitable company. Either way, the burden of responsibility lies with the divisional and company management that failed - not the bottom tier of labor that is simply doing their job.
 

SteveC

Really?
Staff member
Yup.

Great observation.

But who put those people there? And why so many destinations? Are all of the destinations profitable? Or are they there simply to try to increase their market share?

Nevertheless, it's not the station personnel's fault that their management has failed them. The station personnel didn't tell management "You will put flights to this city." Nope, they were hired by a management team that either expect profitability - and failed, or were willfully ignorant to the inability to have a profitable company. Either way, the burden of responsibility lies with the divisional and company management that failed - not the bottom tier of labor that is simply doing their job.
So if/when management figures out that they screwed up, they can close the base and displace the workers, right? Or should they fire themselves and leave the base open so the workers don't get the fallout of management's errors?
 

SoCalAprch

Well-Known Member
So if/when management figures out that they screwed up, they can close the base and displace the workers, right? Or should they fire themselves and leave the base open so the workers don't get the fallout of management's errors?
I agree, there are risks that have to be taken when operating any company. No body can guarantee profitability nor could many have guessed the economy would have turned into this. It is all calculated risk and United's management has been failing miserably at this for quite some time. I just don't understand why the stock holders don't stand up and tell Tilton and his cronies to take a hike.
 

georgetg

Well-Known Member
axed the art director for napkin logos or something.
Oh nooooo. Say it ain so, Doug!


How about this for statistics, forget about frontline employee making a nickel and look at desk jockeys raking in the bonuses:

Mary Kirby has a great article from RunWayGirl

exerpt:
So if American and Delta lead the industry with one officer or director for approximately every 330 employees, who is worst-in-class? That distinction belongs to Northwest, according to American, which notes that the Minneapolis/St Paul-based carrier "has one officer or director for approximately every 95 employees".

It looks like Northwest has some serious managerial trimming to do. While both Delta and Northwest have pledged not to close hubs or furlough frontline workers as a result of a merger, their respective CEOs Richard Anderson and Doug Steenland in mid-May acknowledged at a House aviation subcommittee hearing that there will be management-rank reductions, and these will take about two months to figure out. So expect some info in July. If I was a manager at Northwest, I know what I'd be doing right now (and it would come from the Neal Cohen playbook).
I think there's the merger "synergies" they've been talking about at SweetTea Innanashnul...

Cheers
George
 

granlistillo

Well-Known Member
It's like animal farm. Some animals are more equal than others.
Doug are you calling management pigs??;)

I am pretty much a laissez faire center right type of guy but this industry sickens me. We arent free to strike, really, due to public interest, but they can loot the company?

Makes me want to belt out a few bars of "Beasts of England"
 

SlumTodd_Millionaire

Evil Landlord Capitalist
Captain Wallach and the rest of the UAL MEC are doing a superb job over there of standing their ground and refusing to back down to management's BS. They made a great choice in picking him as their new MEC Chairman. Reminds me a lot of Rick Dubinsky, the father of the '85 strike and the "Summer of Love." Hard-nosed tactics are what get things done when dealing with management like this.

As for UAL's heavy employee load, you only need to look at their training center for evidence of the problem. I was absolutely amazed at the glut of administrative employees that my newhire friends were telling me about over there. They probably have more administrative employees working in the uniform office over there than we have in our entire training center. Uniform office, pass travel office, offices for several managers for each fleet, etc... It's ridiculous. There's absolutely no need to have such a huge infrastructure.
 
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